Guarantees and standby letters of credit
Protection against risks of non-compliance in international operations
The guarantee constitutes a bank commitment to a third party, on the client’s behalf, to ensure compliance with a contractual obligation. The assured obligation may be a payment, a delivery of goods or the rendering of a service, the execution of a work, the refund of an advance payment, a debt with customs or any other obligation derived from a contract.
“Standby letter of credit” is the name given in the USA to the independent guarantee. Its characteristics, uses and contents are essentially the same under both denominations.
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Solutions
What are your needs?
- Ensure compliance with contractual obligations before a third party or of a third party with your company. These are usually:
- In the buyer’s favour, guaranteeing a payment obligation
- In the seller’s favour, guaranteeing the refund of an advance payment, the delivery of goods or the rendering of a service, the execution of a work or the providing of maintenance during the guarantee period
- Have access to an alternative to the cash deposit
- With a swift and professional service and with the greatest experience in the issuing and monitoring of international guarantees
- Immediate notification and guidance regarding guarantees received in your favour
- Issuing of both instruments with adhesion to the international standards of the International Chamber of Commerce, which are universally accepted and provide a stable reference framework:
- “Uniform Rules for Demand Guarantees (URDG758)”, for first-demand guarantees
- “International Standby Practice”, for standby letters of credit, although these may also be issued subject to the “Uniform Customs and Practice for Documentary Credits (UCP600)”
The main types of guarantee in the international sphere are:Tender guarantee
Good compliance or execution guarantee
Payment guarantee
Advanced payment guarantee
Maintenance guarantee
Credit facilities guarantee
Guarantee on bills of exchange and/or promissory notes
Why with Banco Sabadell ?
Personalised advice at the time of issuing or receipt
Issuing of the guarantee without delays
Immediate notification of guarantees received in your favour
You will have maximum legal security
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- Ensure compliance with contractual obligations before a third party or of a third party with your company. These are usually:
- Documents and utilities
Guarantee and letter of credit– A multimedia guide for companies that want to make their business more secure.
Information on Guarantees:
Guide to “ Guarantees ” (Only Spanish)
Why is it a good idea to subject guarantees to URDG758?
In Spanish …
In English …
Information on the rules of the International Chamber of Commerce which regulate first-demand guarantees and standby letters of credit:
URDG758 Rules for guarantees (Only Spanish)
ISP98 Rules for standby letters of credit (Only Spanish)
UCP600 Rules relating to documentary credits (Only Spanish)
Models of Guarantee according to URDG758
In English …
In Spanish …
Universal Standby model
Universal Standby model (Spanish version)